The Injuries Board’s Silence on the Setanta Collapse is Deafening

Setanta was a handy man with a hurley; a bit too handy for his own good in fact. He killed a chieftain’s guard dog while having a knock about, was renamed Cú Chulainn to replace the trusty hound and became a Red Branch knight as a result.

Ulster hurling has been in terminal decline ever since: apart from a few remaining strongholds in my wife’s country in North Antrim.

But the name remains potent and has been purloined to name businesses selling everything from TV sports channels to motor insurance.

It is a name that has lived in infamy lately because some shower decided to use an elaborate Maltese set up to establish an insurance company through which they thought it would be a great wheeze to sell cheap car insurance to the Irish market. They then promptly ran out of money to pay claims and folded their tents and left the market leaving a whole host of innocent motorists high and dry. I didn’t think you could still do this but apparently you can; or at least you could up until earlier this year at least.

Setanta Insurance formally went into liquidation back in April. It was a real pain in the neck for people who had insurance as they suddenly found themselves uninsured even though they may have paid for policies due to run for months into the future. They had to go and buy new policies with alternative insurers lickity split and pay handsomely for the privilege. A pain for sure; but at the same time, just another one of those things that throws an unexpected and completely unjust expense on us every so often. Life is a bitch after all.

HOWEVER, if you were a person who had an accident and the person responsible was insured with Setanta the situation was very much more serious and potentially much more expensive and far reaching than having to stump up for the cost of one year’s replacement car insurance premium.

If the person responsible for the accident in which you were injured was insured with Setanta you suddenly found yourself dealing with an uninsured driver situation (even though the party at fault may have perfectly reasonably believed that they were properly and fully insured at the time.)

There are two scenarios here:

One is the Insurance Compensation Fund but this will not pay out more than 65% of the value of a claim and is capped at €825,000 for any one claim (it is also further limited in the case of commercial insurance policies).

The other is the Motor Insurer’s Bureau of Ireland (the MIBI). This is the organisation that covers innocent victims of accidents when they are injured by uninsured drivers; it’s a pool funded by all the insurance companies.

“Sorted” you may say.

Well, it’s not that simple. As they say in the shampoo ads here comes the science bit (stick with me):

If you’ve been injured by an uninsured driver you’ve got to notify the MIBI straight away and join the MIBI to any legal proceedings you may need to bring (this would include an application to the Injuries Board). The MIBI is governed by an agreement and, if you don’t comply with the terms of the agreement, they’re not obliged to pay.

In a case like Setanta, where you only became aware of the uninsured element late in the day, you could notify the MIBI and join them to the proceedings as soon as you became aware and all would probably be well. In fairness the MIBI are likely to adopt a common sense approach and just deal with the claim if it arises properly in a case like this.

But, here’s the catch, under the agreement the MIBI must be joined to the proceedings BEFORE any order is made in the proceedings. If a case is settled or an order is made in the proceedings before the MIBI are notified they cannot be brought in and made liable to pay afterwards.

This would include an assessment by the Injuries Board which is enforced by what is known as an order to pay made by the Injuries Board.

If an application to the Injuries Board were made against a person insured with Setanta and then allowed to run its course without subsequently joining the MIBI to the application after the Setanta liquidation occurred and the Injuries Board then when on to assess the injured person’s claim and make an order to pay in their favour for that amount, that order would be utterly worthless as the insurance company behind it was insolvent.

However, because the MIBI was not notified and joined to the proceedings BEFORE the order to pay was made they would not be liable to pay and the injured person would be left with no effective remedy.

Now, the point of all of this is that the Injuries Board goes about blithely peddling the notion that an application to the Injuries Board is a mere trifle that any red blooded person should be well able to handle on their own. There’s no need for troublesome and expensive solicitors they say, you can do it all yourself. All you have to do is fill out a form after all.

Many lawyers probably don’t know about the finer workings of the MIBI agreement in the case of insolvent insurance companies; how on earth is an unrepresented applicant to the Injuries Board supposed to have a clue about any of this.

Incidentally I went to the Injuries Board website just before I wrote this and typed in “Setanta” in the search box and got “No Results”. Their News section contains a series of press releases mainly telling everyone how great they are.

What does the Injuries Board website say on the subject of what innocent accident victims might do if the person responsible for their injury happened to be insured by Setanta (one of the biggest stories in the area of personal injuries and related insurance matters in recent months)?

Nada; butkis; zero info…

But hey, who needs a solicitor?

If you’re wondering whether you do for your Injuries Board application get your free extract from our guide below or call us now on Freephone 1800 989 111

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Flor McCarthy is one of Ireland’s leading lawyers, certified by the Law Society of Ireland in Data Protection Practice. Flor has extensive expertise and hands-on practical experience in privacy, data protection and GDPR issues for marketers. He was chosen as Munster Solicitor of the Year at the Irish Law Awards in 2018.